The Department of Labor's new guidelines for salaried employees, which promise to include a substantial elevation in the minimum salary that can be associated with salaried work, that is, work that is exempt from overtime pay. These guidelines go into effect December 1. This presentation from Rev. Anne McKee at Maryville College builds on the presentation she gave at SLI. It highlights Maryville College changes to campus policy and how their Bonner staff is managing this change.

1. Scaling Down?
THE ELUSIVE 40 HOUR WEEK AND THE NEW DOL OVERTIME
STANDARDS

2. FLSA Background
Duties Test - the employee’s job duties must primarily involve
executive, administrative, professional, computer or outside sales
duties (also known as “EAP” or “white collar” duties).
Salary Basis Test - the employee must be paid a predetermined and
fixed salary that is not subject to reduction because of variations
in the quality or quantity of work performed;
Salary Level Test - the amount of salary paid must meet a minimum
specified amount.
First enacted in 1938, the FLSA established three tests that must
be met in order for an employee to be exempt from overtime pay
eligibility*:
*Note: Faculty members whose duties consist primarily of teaching and attorneys and
physicians are always exempt status under the FLSA.
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3. FLSA Changes at a Glance
Current
•Salary test $455/week ($23,660/
year)
•No automatic increases
•Salary threshold was set in 2004
Changes as of December 1,
2016
•Salary test $913/week ($47,476/
year)
•Represents 40th percentile of
weekly earnings of full-time
salaried workers in the lowest
wage census region in US – South.
•Auto-updates every three years
beginning January 1, 2020.

4. So, as of December 1, 2016,
employees who make less than
$47,476 per year or $913 per week
will need to be paid overtime for
every hour they work above 40 in a
week.

5. Maryville Center for Campus Ministry
example:
Sept. 2015– May 2016:
• averaged 48 hours per week
• Future non-exempt staff averaged 45 hours a
week
If we had paid the non-exempt staff overtime,
they would have earned an additional $11,540
together over nine months, or $15,387 annually
(together).

6. What are options for colleges?
Raise salaries to the $47,476 threshold. (At Maryville, 11 employees are getting raises
for this)
Reclassify other positions as non-exempt: (At Maryville, this is 69 positions)
◦ Pay overtime (1.5 time hourly rate) for hours worked over 40 in a week.
Rethink duties to limit overtime.
Reclassify some positions:
◦ Coaches can be classified as teachers if over half their time is spent teaching the sport.
◦ “Academic administrative employees” “Primary duty is performing administrative functions
directly related to academic instruction or training in an educational establishment.” Must be
paid on salary basis at least equal to the entrance salary for teachers in the same school.
Examples are department heads, academic counselors and advisors.
Adjust number of weeks worked – move from 52 weeks per year to some proportion, so
that salary meets the $913/week threshold.

7. What is non-exempt?
•Non-exempt employees are “not exempt” from the FLSA.
•The employer is REQUIRED to compensate the non-exempt
individual at a rate of time and ½ for any hours worked over
40 hours in a work week.
•A work week is defined as a set 7-day period of time
established by the employer.

8. New Procedures for FSLA:
1. Overtime fund and limiting hours to 40 per week,
for non-exempt employees.
2. New after-hours communication policy.
3. New flex-time policy.
4. Travel policies and non-exempt employees.
5. Policies for exempt employees who are working
fewer weeks.

9. Overtime procedures around
reclassified (non-exempt) positions:
Creation of “overtime fund” held by each Vice President, which can be used for
unavoidable overtime situations:
◦ For Bonner travel, retreats, interviews, other events beyond the normal work week:
◦ 1. Each supervisor turned in an overtime budget, estimating how many hours will be
needed. This will need to be updated with each year.
◦ 2. See if it’s possible to use Flex time within the same week, to avoid working over 40 hours
– eg., if interviewing for 6 hours on Saturday, is it possible to take most of a day off earlier
in the week, or come in two hours late on several days?
◦ 3. If not, then IN ADVANCE, the supervisor will write the VP and say that we anticipate
needing 6 hours of overtime for this particular day and activity. The VP will approve in
advance.
◦ 4. Our plan is to work on a calendar monthly, to create the work schedule, and then update
as reasonable, to avoid overtime.
◦ 5. All overtime must be tracked and paid for, whether it’s budgeted or not.

10. Example: Bonner Coordinator is now
a non-exempt employee:
◦ For Bonner retreat in February, we will have Friday night and Saturday
work hours – est. 10 extra hours. If possible, we will find a few hours of
flex time earlier in the week, but we have budgeted 10 hours OT, just in
case.
◦ For Alternative Spring Break, which starts on a Sunday and ends on a
Saturday:
◦ See new travel procedures!
◦ We have estimated 40 hours of overtime.
◦ Hourly rate is based on 2080 hours per year. OT is 1/5 times hourly rate.
◦ OT is only for hours worked over 40 hours a week. If you work extra days
in a week with a holiday, it’s more complicated – you will be paid for
that time, but not 1.5 times your rate.

11. After-Hours Communication
See attached sheet:
1. All communication – phone, texts, email – is compensable time.
2. A timetable for how to count the hours.
3. Rolling out communication tips to Bonners, other students – so they
will be mindful of when they expect to hear back from us.
4. Consider an out-of-office message when you leave daily, saying when
you will return.
5. Remove work email from your phone.

12. Tips for a 40 hour week
Plan in advance:
Shared Outlook calendar with everyone’s work plan for the week.
When meetings come up, you have to take away a block of hours elsewhere.
Everything counts! Email at home.
But made us think through, “ Is this really work? Does it change if I think of it
differently?”

13. Flexible (Flex) time vs.
Compensatory (Comp) time
Comp time is a way overtime can be paid in time instead of money.
◦ So, if an employee works 42 hours in a week, they can be paid in time – 3 hours of comp time
(1.5 times the overtime worked) instead of money.
◦ Comp time can be accrued and used in the future.
◦ There are various regulations about this.
In general, only public universities can use Comp time.
Flex time is time within a particular work week, which allows an employee to reduce
hours during the week to make up for extra hours worked in the same week.
◦ If you anticipate an evening meeting on one day, from 5 til 8 pm, then you may come in
three hours later, that day or another day that same week.
◦ If you have had to work an emergency on Sunday night, for 4 hours, you have that whole
week to make it up.

14. More about Flex Time
Each employer can designate its standard work week. At MC, our week starts midnight
Sunday and goes through midnight Saturday.
Thus, if you work on Sunday, you have until the next Saturday to flex those hours,
without going over 4. If you work on Saturday, you must take those hours off earlier
that same week. If you go over 40 hours (say, you were planning for a 4 hour event,
and worked 6 instead), you must be paid overtime.
Time cards must reflect the actual hours worked, including any at-home
communication. The supervisor is supposed to approve flex time in advance.
In our office, we plan to work on the schedule monthly, but then review it at the start
of each week, to balance employee needs and the office needs.

15. Compensable Time While Traveling:
Crazy, but this is what they told us:
•If traveling for the College, track the hours traveling in the car, bus, plane
etc. as work hours for that day if they fall during your normal working
hours. If you are a passenger the time is not compensable beyond your
normal work schedule. If you are driving, the time is compensable.
•If traveling for the College, do not track hours that you are sleeping, or
hours where you are free to do as you wish. This time is not compensable.
•If traveling for the College, track hours that you are involved in workshops,
conferences, College fairs, or meetings. This time is compensable.

16. Travel, the Bonner program at MC
Example: Alternative Spring Break in DC:
Sunday: Ride Megabus to DC: work hours while gathering up students, planning trip,
dealing with student needs. If only sleeping, reading for pleasure, etc., non-
compensable time.*
◦ Arrive in DC: settle in, shop, lead reflection, plan for week – all this is compensable time.
◦ Evening – if reading, sleeping, not interacting with group – non-compensable time.
Monday – Friday: Count all time helping the group, serving, etc. Don’t count hours sleeping or
on you own. But if something happens in the middle of the night, back on the clock. Do count
meals taken with the group, not if you’re simply on your own.
Saturday: Return on Megabus – count same as on Sunday’s trip. Working if interacting or
managing for the group; not working if on one’s own.
Every day must have at least a 30 minute unpaid break after 6 hours of work (TN State
law). Check the rules for this in your own state.

17. For schools that cut the months
worked:
Be mindful of the proportion of employment necessary for being eligible for benefits.
At MC this is over 75% time.
Remember that annual leave or vacation is IN ADDITION to unpaid leave, and is in
proportion to percentage of employment.
Example:
See next slide

18. Example
Jane was making $36,000 annually. The college can’t afford to give her a raise to
$47,476, and wants her to remain exempt.
$36000 / $913 = 39.43.
This means that if Jane works 39 weeks per year, she will meet the FSLA weekly
minimum.
39/52 = .75 Jane would then be a 75% time employee. Check to make sure she would
be eligible for benefits. If not, it would be better for the college to give her an
increase of $913, so that she can work 40 weeks a year.
Jane will need to designate 13 weeks per year that she will be off. Maybe she will take
off May 15 – August 15 every year (we will miss her at SLI!).
If she was previously getting 20 days of vacation, she now will get 16, which must be
taken during the school year.
This is probably a better option for someone who was making more than Jane!

19. Questions?
I don’t know everything, but am glad to talk about any of this:
Anne McKee
Maryville College
anne.mckee@maryvillecollege.edu
865-981-8298
865-659-1314

20. Tips for getting ready
See what your institution is doing to get ready.
Have everyone keep logs of hours.
Supervisors – find out now what your people are making. Do the math, to protect them
from salary adjustments that mean they will have to work overtime to make what they
make now.
Sites and documents to refer to:
https://www.dol.gov/whd/overtime/final2016/highered-guidance.pdf
https://www.dol.gov/sites/default/files/overtime-highereducation2.pdf